Peet's supports African farmers

A member of the cooperative harvesting coffee beans.

Peet’s Coffee & Tea (NASDAQ: PEET) in January announced its first new permanent coffee blend in eight years—the result of a partnership with nonprofit TechnoServe, which is working with African coffee growers to help them build sustainable businesses.

Prior to TechnoServe’s efforts, the coffee growers it now works with sold mostly unprocessed coffee fruit, a practice that brought them the lowest price possible for their crops, says Shirin Moayyad, director of coffee purchasing at Emeryville-based Peet’s. TechnoServe’s local African staff of business advisors helps the coffee farmers understand and meet the quality requirements of U.S. coffee buyers.

The organization also connects grower cooperatives to financial institutions and helps them learn the art of writing business plans so they can raise funds to purchase efficient mechanical processors. Finally, TechnoServe connects the co-ops to buyers willing to pay a premium price for the beans, such as Peet’s which reported net revenue of $73.9 million in 3Q 2009.

Peet’s new blend, called Uzuri African Blend, comes from beans grown by 6,000 small-scale farmers in Kenya, Tanzania and Rwanda. How much the relationship with Peet’s will benefit individual farmers is not yet known. The company’s first purchase in 2004 of coffee beans from farmers in Tanzania assisted by TechnoServe resulted in revenues for the farmers 160 percent higher than they’d ever received, Moayyad says.

The coffee in Peet’s new blend is not certified by any organization which Moayyad says she understands could be a stumbling block for consumers who want independent certification of the program. “Right now, with TechnoServe, the proof in the pudding is what the farmers say and what benefit is going back to the farmers, and that is traceable,” she says. “Now how we communicate that ultimately, I am not certain yet. This is all just a work in progress.”